Empty Spaces May Have Saved MetLife

Vacant AT&T lot sought for parking, but phone company dawdled

March 29, 2007
By DIANE WEAVER DUNNE, Hartford Business Journal Writer

As do many real estate decisions in the city of Hartford, the question of whether MetLife would stay downtown may simply have come down to the issue of parking.

MetLife wanted more parking available to it if it was to stay and expand at CityPlace, the state’s largest office tower. And right across the street, in plain view, sat a vacant parking lot owned by AT&T.

Yet, despite numerous meetings of city officials, real estate brokers, parking authority leaders, building managers and AT&T officials months ago, no deal to get that parking lot onto the market was struck until it was too late.

AT&T finally put the lot up for sale last week. But MetLife, which hasn’t officially announced that it’s moving to Bloomfield, has already received approval for building plans there.

For months city officials and CityPlace management tried to persuade AT&T to expedite the sale of the parking lot because they considered it a critical component in retaining MetLife in the city.

The lot is located between Pearl Street and Bushnell Park, adjacent to AT&T’s Trumbull Street building, and across from the MetLife offices at CityPlace, where MetLife currently occupies 300,000 square feet on four floors.

AT&T spokesman Seth Bloom said late last week that the lot is on the market. “At this point, we don’t have an offer on the table, but we are very willing to entertain an offer,” he said. “I don’t know that there is a real offer to respond to. We are open to discussions. And that is where things stand.”

Surprise Announcement

The fact that the parking lot is now officially available to be sold came as a surprise to city officials, who, were under the impression from company representatives that the lot was not yet for sale.

The announcement about the availability of the AT&T parking lot most likely comes too late to alter MetLife’s intention to move out of Hartford.

However, MetLife spokesman John Calagna declined to comment about the matter, noting that the company has not finalized a deal for any building yet. He did acknowledge that the company was looking for some amenities for its employees, including a cafeteria, fitness center — and parking.

Parking Critical Issue

Understanding that parking was a critical issue for MetLife, and that there is a parking shortage in the area near CityPlace, CityPlace and city officials communicated their desperate desire to acquire the AT&T parking lot to satisfy MetLife’s parking needs, a requisite to retain the company as a tenant at CityPlace.

AT&T officials agreed to sell the lot in principle at a June 2006 meeting with James Kopencey, executive director of the Hartford Parking Authority, and CityPlace property manager Robert Austin. But seven months later, as of late March, AT&T had not moved forward on the sale.

In a letter dated Jan. 16 to Kopencey, Austin urged him to solicit the help of high-ranking city officials to make contact with their high-ranking counterparts at AT&T.

Time was running out, and Austin knew it. It was a last ditch effort to hang on to MetLife as a tenant.

The time lag was especially troubling to Kopencey because the AT&T lot sale would require a bidding process overseen by the state Department of Public Utility Control, a factor that would elongate the transaction even more.

Austin emphasized in his letter, viewed by the Hartford Business Journal, that CityPlace was willing to pay full price for the property, and was not looking for a discounted deal. Kopencey said that CityPlace would also work cooperatively with the city and assign the property to the parking authority for the construction of a new parking garage downtown.

Mayoral Muster

In response to Austin’s request, Kopencey forwarded Austin’s letter to Mayor Eddie Perez, suggesting that he personally contact AT&T officials. Kopencey reasoned that a direct appeal from Perez would carry more weight and persuade AT&T officials to move more quickly.

Whether Perez made a timely effort to help is in question. After the letter was sent to the mayor’s office, Kopencey said he continued to receive requests from CityPlace representatives for mayoral intervention in the matter.

Perez asserts he personally spoke to local and New York AT&T officials about the AT&T parking lot.

“I was directly involved with those discussions with AT&T,” he said.

“But MetLife never requested a time table that AT&T missed. We never had any parameters to do that. We know the folks of CityPlace [Limited] Partnership wanted that deal to move forward,” Perez explained.

Perez maintains that the company never articulated its needs to the city as other top employers do when considering a renewal of their leases.

AT&T’s Bloom said the lag in putting the parking lot up for sale pertained to the sensitive telecommunication infrastructure located below the lot and a requirement that AT&T would still have access from the property to its Trumbull Street building.

“We certainly needed to do our due diligence,” Bloom said.

Regulatory Issues

Because the sale would become a DPUC matter, Perez doesn’t believe that the city could have done anything differently that might have changed MetLife’s anticipated decision to leave Hartford.

Jonathan Putnam, a local broker with Cushman and Wakefield who represents both MetLife and AT&T, agrees.

“Perhaps people want to look for blame, when in fact, there is no one factor that leads to a decision like this,” Putnam said, noting that it is difficult for the city to compete with an attractive, 500,000 square-foot building in the suburbs. There is an abundance of free parking available on Cigna’s expansive Bloomfield campus, where MetLife will likely relocate.

“When you compare costs and operations and all the ingredients that go into that operation, a good quality suburban building is very attractive,” Putnam said.

Just days before the AT&T announcement last week, Putnam – as AT&T’s real estate agent — had not been informed by the company that it was imminent that the lot would be put up for sale, stating that the AT&T parking lot would go up for sale eventually.

“But there are many internal decisions that have to be made,” Putnam warned. “You can’t force the timing of how those decisions are going to be made.”